As Victor Paterno ends his year as the National Association of Convenience Stores (NACS) chairman, he reflects on the rollout of TruAge, the difference between c-stores in the United States and the Philippines and the message he wants to share with the industry. Paterno is president and CEO of Philippine Seven Corp., which holds the license to operate 7-Eleven stores in the Philippines. There are 3,600 stores operating on the main island of Luzon, of which 54% are franchised.
Q: How has your year as chairman gone?
A: I originally became engaged with NACS because of TruAge, the digital age-verification system designed to make the purchase of age-restricted products safer, smarter and faster. But TruAge is just one part of a much more complex digital ecosystem that includes digital coupons and a host of other applications. We’ve made significant progress this year, but we’ve had unexpectedly lengthy delays in integration with POS (point-of-sale) vendors—though a shoutout to Verifone for being the first mover by a country mile. It’s important to note that chairmen don’t specifically roll out platforms and initiatives specific to their year. The digital initiative was put together by NACS staff and backed by the Executive Committee long before my tenure. I just thought it was the most exciting thing and the one I was best positioned to help out on since we’ve done similar efforts in the Philippines
Q: What did you learn as NACS chairman that you will take back to your own chain?
A: The U.S. and the Philippines—and for that matter, the rest of Asia—are as vastly different as can be. Our stores are much smaller and don’t have fuels; we do all our own distribution and have no shortage of labor. So, there’s not that much that I can take back operations-wise that applies directly, unfortunately. Instead, the big learning for me is that the NACS technology vision is state of the art and way beyond what anyone, including us, is doing. But my biggest learning has been how the industry really comes together to advance common interests while still competing to serve the customer.
"I believe NACS is an extraordinary organization and can do even greater things. Since technology is the easiest way to bring together a fragmented and far-flung membership base, I thought I might be able to help, and certainly learn something along the way. And I was right." —Victor Paterno, Philippine Seven Corp.
Q: If there’s one message you could share with the industry, what would it be?
A: Our industry has one advantage that no other channel can replicate: We are closer to the customer than anyone else. We are closer proximity-wise, of course, with one store per every 2,000 people—and as tech giants in the U.S. and elsewhere have shown, you can’t just muscle into this space, no matter how much capital you have. But what I really mean by proximity is the relationship that we have with customers on a daily basis. We see them more than anyone else. Everyone wants a piece of this, including the tech companies. They don’t have it, and we need to continue to cultivate these relationships that have enormous value. Our industry should benefit from the monetization of these relationships that technology allows. There is no reason to give this right of way away, and TruAge continues to be our best and biggest hope of making this happen.
Q: How do you feel about the future of convenience retailing?
A: We exist on two levels. We exist on a micro level, serving customers individually. But on a macro level, we can do even more together. It requires critical mass, and that’s something that NACS can deliver. In the United States, having 10% of the market would be incredible. In the Philippines, a company with 10% of the market doesn’t get much traction. When I look at both the micro and macro levels, I’m very optimistic. Individually, we touch more people on a daily basis than anyone. We have a chance to change their moods, and as my good friend Don Rhoads (president of The Convenience Group, Vancouver, Washington) said at last year’s NACS Show, people are generally in a bad mood today. We have real power in what we can do for society in making it a better world.
Q: What are you looking forward to at NACS in October?
A: Seeing my giant face at the entrance. Kidding aside, because I’m actually a pretty shy sort. While it’s been one of the greatest honors in my life to serve as NACS chair, I didn’t fly hundreds of hours to and from the U.S. over the past few years just to pad my resume. I did it because I believe NACS is an extraordinary organization and can do even greater things. Since technology is the easiest way to bring together a fragmented and far-flung membership base, I thought I might be able to help, and certainly learn something along the way. And I was right.
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